NASD Fines, Suspends Quattrone

The actions stem from the investment banker's failure to cooperate in an investigation.
Author:
Publish date:

It may be the least of his problems, but former star investment banker Frank Quattrone has been fined and sanctioned for failing to cooperate with an investigation by securities regulators.

A

NASD

hearing panel fined the former

Credit Suisse First Boston

banker $30,000 and suspended him from working on Wall Street for a year because of his noncooperation.

The NASD had asked Quattrone to testify as part of the regulatory agency's investigation into allegations that the former tech banker tried to obstruct a federal investigation of CSFB's investment banking division. Quattrone refused to testify because the request came at a time when he was preparing to go to trial in federal court on a related criminal charge.

In October, following a four-week trial, an 11-member jury was unable to reach a verdict. The former banker is slated to be tried again in the spring.

Last year federal prosecutors in Manhattan charged Quattrone with two counts of obstruction and one count of witness tampering in a case that largely revolves around a single email the investment banker sent to his colleagues nearly three years ago.

Prosecutors contend that Quattrone tried to get CSFB employees to destroy emails and other communications just as a Justice Department probe of the bank's IPO practices was beginning. The investigation centered around allegations that CSFB dished out hot IPO shares to favored clients and hedge funds in return for higher-than-normal commissions, or "kickbacks."

The criminal investigation of CSFB ended without any charges being brought, but the company settled a related civil investigation by the

Securities and Exchange Commission

and the NASD by paying a $100 million fine.